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Exhibit 99.1
[AMKOR TECHNOLOGY LOGO]
News Release
AMKOR TECHNOLOGY REPORTS RECORD THIRD QUARTER RESULTS
West Chester, PA. - October 31, 2000 -- Amkor Technology, Inc. (Nasdaq: AMKR)
cited continued strength in outsourcing trends in reporting financial results
for the third quarter ended September 30, 2000. Total revenues were $649
million, an increase of 29% from $502 million in the third quarter of 1999 and a
19% increase over the second quarter of 2000. Assembly & test revenues rose to
$549 million from $430 million in the third quarter of last year. Wafer fab
revenues were $100 million compared with $72 million in the third quarter of
1999.
Net income before the amortization of goodwill and acquired intangibles was $73
million, or $0.46 per share, compared with $34 million, or $0.27 per share, for
the third quarter of 1999. Including amortization of goodwill and acquired
intangibles net income was $45 million, or $0.28 per share, compared with $26
million, or $0.21 per share, for the third quarter of 1999.
There were 159 million weighted average shares outstanding on a fully diluted
basis for the third quarter of 2000 compared with 136 million in the year-ago
period.
For the first nine months of 2000, revenues rose 28% to $1.75 billion from $1.37
billion in the first nine months of 1999. Net income before the amortization of
goodwill and acquired intangibles more than doubled, to $171 million, or $1.13
per share, compared to $69 million, or $0.56 per share, for the first nine
months of 1999. Including amortization of goodwill and acquired intangibles net
income was $113 million, or $0.75 per share, compared with $57 million, or $0.47
per share, for the third quarter of 1999.
"We had an exceptionally strong third quarter, with virtually all markets
showing solid demand," said John Boruch, Amkor's President. "We saw especially
robust growth in our laminate package products. This strong performance reflects
positively on the health of our business."
"The trend towards outsourcing of assembly & test, as reflected in the proposed
Toshiba J.V., continues to be a key growth driver, and we expect this trend to
accelerate during the next several years," said Mr. Boruch.
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"The gross margin for the third quarter of 2000 rose to 24.5% from 22.7% in Q2
'00 and 19.4% in Q3 '99. The increase in Q3 gross margin reflects a full
quarter's ownership of the K1, K2 & K3 factories acquired from Anam
Semiconductor on May 1, 2000," said Ken Joyce, Amkor's Chief Financial Officer.
Third quarter 2000 gross margin reflects the inclusion of $20.2 million in "cost
of goods sold" for amortization of goodwill and acquired intangibles primarily
in connection with the K1 - 4 acquisitions. Absent this amortization, our Q3
gross margin would have been 27.6%. For the third quarter of 1999, these figures
were $7.8 million and 20.9%, respectively.
"We believe that presenting goodwill amortization as a separate line item
provides a more appropriate measure of our operating performance, and is also in
line with the precedents established by other companies in our industry," said
Mr. Joyce. "Therefore commencing with our Q4 financial disclosure, we will be
reporting the amortization of goodwill and acquired intangibles previously
included in Cost of Revenues as a separate line item, below the gross profit
line. Consequently, our gross margin guidance for Q4 and future periods will
reflect this treatment."
"The pricing environment in semiconductor packaging remained within normal
ranges," noted Mr. Joyce. "Overall packaging ASP declines were around 2.1% for
the third quarter, compared with 3% in the prior quarter. We remain focused on
improving our product mix by incorporating more advanced package technology and
design."
"We expect consolidated gross margin to be stable in the fourth quarter, or
approximately 27% to 28% under the treatment noted above," said Mr. Joyce.
Operating income rose to $100 million from $54 million in the third quarter of
1999. Excluding the amortization of goodwill, third quarter operating income was
$120 million and $62 million for 2000 and 1999, respectively. Pre-tax profit
rose 78% to $62 million from $35 million in Q3 of 1999. Depreciation and
amortization expenses were $99 million compared with $52 million in the third
quarter of 1999.
Third quarter EBITDA rose sharply to $197 million from $103 million in Q3 '99.
We have calculated EBITDA as earnings before income taxes; equity in income
(loss) of affiliates; foreign currency gain or loss; interest expense, net;
depreciation and amortization. EBITDA is a common measure used by investors to
evaluate a company's ability to service debt. EBITDA is not defined by generally
accepted accounting principles.
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Unit shipments rose 33% over the year-ago quarter and 13% over the second
quarter of 2000. Overall assembly capacity utilization rose to 85% from 75% in
the second quarter of 2000. Utilization was 87% in the third quarter of 1999.
High end (advanced leadframe and laminate) products were 69% of packaging
revenues for the third quarter, compared to 63% in the third quarter of 1999.
Third quarter test revenue increased 43%, to $31.4 million from $21.9 million in
Q3 of 1999.
"We have been aggressively building our test capabilities, in terms of both test
assets and engineering staff, to support an accelerating demand for outsourcing
our customers' testing requirements," said Mr. Boruch. "We are particularly
excited about our industry-leading capability in the area of Strip Test, which
was co-developed by Amkor and several leading test technology partners. Strip
Test allows a higher level of integration between the assembly and test
processes and provides such key benefits as shorter cycle time, improved asset
utilization and reduced testing costs. We expect to increase our test revenue by
80% in 2001"
"Recently, some questions have been raised regarding the state of the
semiconductor cycle," continued Mr. Boruch. "It is important to note that
throughout our 32-year history, Amkor has typically grown during semiconductor
industry downturns. This is a period when integrated device manufacturers tend
to focus more on their core competencies of chip design and fabrication, and
look more toward outsourcing their assembly and test. In addition, the
production - and consumption - of semiconductor units continues to increase, and
Amkor is a unit-driven company. Our highly diversified customer base, which
covers the entire spectrum of the microelectronics industry, together with our
broad array of packaging and test technology and unequalled manufacturing scale,
are key factors contributing to Amkor's growth during industry downturns. We are
well positioned to maintain this track record."
Anam's wafer foundry continued to ramp toward its full design capacity of 30,000
wafer starts per month. During the third quarter, the fab averaged approximately
24,000 monthly wafer starts on behalf of Texas Instruments, Atmel and other
foundry customers. The company expects wafer starts to increase to 30,000 per
month by the end of Q1 2001.
"Looking ahead, we expect strong growth in a broad range of chip scale packages,
such as ChipArray, Tape BGA, MicroLeadframe and High-End BGA, that have been
designed to support 0.18 micron fab process technology," said Mr. Boruch. "In
addition, we expect our Flip Chip business to grow significantly in 2001. We are
installing a fully integrated bumping, plating and packaging operation that will
allow us to support Flip Chip devices at 0.15 micron and below."
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"In our developing System-in-Package business, we have established a strong
infrastructure to support what we believe will be significant growth
opportunities in 2001 and beyond," said Mr. Boruch. "Our growing portfolio of
SiP packages is providing a variety of solutions in the wireless, broadband and
storage markets."
"Our High Density Leadframe program has enabled Amkor to be a very cost
competitive producer of leadframe packages. These initiatives position us to
further consolidate our market leadership in this highly profitable product
family," said Mr. Boruch.
"Finally, we plan to be well positioned in the area of packaging optical
components," said Mr. Boruch. "We have been exploring a number of opportunities
with leading optical device companies in North America and Europe and hope to
have more news to announce within the next several months."
"Our long-term growth has typically been in the 20% to 25% range, which is
generally the rate that the outsourced market has expanded. Our current plans
for 2001 are to grow our Assembly & Test revenue by 35% and Wafer Fab revenues
by 20%. Our proposed transaction with Toshiba should close on or about December
1. This joint venture should bring Amkor $300 million in revenue over the next
twelve months and represents the first step in consolidating what we believe is
an $8 billion captive semiconductor assembly and test market in Japan," said Mr.
Boruch.
Amkor will be holding a conference call on October 31 at 5:00 p.m. eastern time
to discuss the results of the third quarter in more detail. Participants can
access the call at 712-271-0002. The call will also be webcast through our web
site, http://www.amkor.com.
Amkor Technology, Inc. is the world's largest provider of semiconductor assembly
and test services. The company offers a complete set of micro-electronics
manufacturing services including deep submicron wafer fabrication, wafer probe
testing, IC packaging design, assembly & testing, burn-in, characterization and
reliability testing. More information on Amkor Technology, Inc. is available
from the company's SEC filings and on Amkor's web site, http://www.amkor.com.
Amkor is traded on the Nasdaq Stock Market under the symbol AMKR.
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This news release contains forward-looking statements - such as (1) our belief
that the trend towards outsourcing of assembly & test continues to be a key
growth driver, which should accelerate during the next several years; (2) our
belief that we are well positioned to maintain our track record of growth during
industry downturns; (3) our expectation that consolidated gross margin will be
stable in the fourth quarter, or approximately 27% to 28% when excluding the
amortization of goodwill and acquired intangibles; (4) our expectation that our
Flip Chip business will grow significantly in 2001; (5) our expectation that, in
the area of optical packaging, we will have news to announce within the next
several months; (6) our current plans for 2001 are to grow our Assembly & Test
revenue by 35% ,Wafer Fab revenues by 20% and Test revenues by 80%; and (7) our
belief that the proposed transaction with Toshiba should close on or about
December 1 and should bring Amkor $300 million in revenue over the next twelve
months; - that involve risks and uncertainties that could cause actual results
to differ from anticipated results. Further information on risk factors that
could affect the outcome of the events set forth in these statements and that
would affect the company's operating results and financial condition is detailed
in the company's filings with the Securities and Exchange Commission, including
the Report on Form 10-Q for the fiscal quarter ended June 30, 2000.
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Contact: Jeffrey Luth (Investors) Ken Jensen (Media)
610-431-9600 ext. 5613 480-821-2408 Ext. 5130
[email protected] [email protected]
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(tables to follow)
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AMKOR TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS ENDED FOR THE NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
(UNAUDITED) (UNAUDITED)
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net revenues $648,576 $501,816 $1,750,423 $1,371,698
Cost of revenues -- including purchases
from ASI 469,518 396,532 1,316,739 1,132,450
Amortization of goodwill & other acquired
intangibles 20,179 7,795 41,633 12,421
-------- -------- ---------- ----------
Total cost of revenues 489,697 404,327 1,358,372 1,144,871
-------- -------- ---------- ----------
Gross profit 158,879 97,489 392,051 226,827
-------- -------- ---------- ----------
Operating expenses:
Selling, general and administrative 50,257 40,376 139,386 105,499
Research and development 8,838 2,990 17,081 8,084
-------- -------- ---------- ----------
Total operating expenses 59,095 43,366 156,467 113,583
-------- -------- ---------- ----------
Operating income 99,784 54,123 235,584 113,244
-------- -------- ---------- ----------
Other (income) expense:
Interest expense, net 36,787 16,995 81,644 29,429
Foreign currency (gain) loss 2,015 (253) 4,607 151
Other expense(income), net (613) 2,597 1,425 6,225
-------- -------- ---------- ----------
Total other expense 38,189 19,339 87,676 35,805
-------- -------- ---------- ----------
Income before income taxes and equity in
loss of investees 61,595 34,784 147,908 77,439
Provision for income taxes 9,239 8,696 24,425 20,906
Equity in loss of investees (7,185) 0 (10,220) 0
-------- -------- ---------- ----------
Net income $45,171 $26,088 $113,263 $56,533
======== ======== ========== ==========
Per Share Data:
Basic net income per common share $0.30 $0.22 $0.79 $0.48
======== ======== ========== ==========
Diluted net income per common share $0.28 $0.21 $0.75 $0.47
======== ======== ========== ==========
Shares used in computing basic
net income per common share 151,831 118,276 143,744 118,090
======== ======== ========== ==========
Shares used in computing
diluted net income per common share 158,833 135,626 151,663 134,079
======== ======== ========== ==========
</TABLE>
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AMKOR TECHNOLOGY, INC.
SUPPLEMENTAL CONSOLIDATED STATEMENTS OF INCOME EXCLUDING
AMORTIZATION OF GOODWILL AND OTHER ACQUISITION-RELATED INTANGIBLES
(IN THOUSANDS, EXCEPT PER SHARE DATA)
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<CAPTION>
FOR THE THREE MONTHS ENDED FOR THE NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
(UNAUDITED) (UNAUDITED)
2000 1999 2000 1999
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<S> <C> <C> <C> <C>
Net revenues $648,576 $501,816 $1,750,423 $1,371,698
Cost of revenues-including purchases from ASI 469,518 396,532 1,316,739 1,132,450
-------- -------- ---------- ----------
Gross profit 179,058 105,284 433,684 239,248
-------- -------- ---------- ----------
Operating expenses:
Selling, general and administrative 50,257 40,376 139,386 105,499
Research and development 8,838 2,990 17,081 8,084
-------- -------- ---------- ----------
Total operating expenses 59,095 43,366 156,467 113,583
-------- -------- ---------- ----------
Operating income 119,963 61,918 277,217 125,665
-------- -------- ---------- ----------
Other (income) expense:
Interest expense, net 36,787 16,995 81,644 29,429
Foreign currency loss 2,015 (253) 4,607 151
Other expense(income), net (613) 2,597 1,425 6,225
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Total other expense 38,189 19,339 87,676 35,805
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Income before income taxes and equity in
loss of investees 81,774 42,579 189,541 89,860
Provision for income taxes 9,239 8,696 24,425 20,906
Equity in income of investees 344 0 5,839 0
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Net income $72,879 $33,883 $170,955 $68,954
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Per Share Data:
Basic net income per common share $0.48 $0.29 $1.19 $0.58
======== ======== ========== ==========
Diluted net income per common share $0.46 $0.27 $1.13 $0.56
======== ======== ========== ==========
Shares used in computing basic 151,831 118,276 143,744 118,090
net income per common share ======== ======== ========== ==========
Shares used in computing 158,833 135,626 151,663 134,079
diluted net income per common share ======== ======== ========== ==========
</TABLE>
The above supplemental consolidated statements of income exclude the effects of
the following:
During the three months and nine months ended September 30, 2000, the
amortization of goodwill and other acquired intangibles excluded from cost
of revenues was $20.2 million and $41.6 million, respectively.
During the three months and nine months ended September 30, 1999, the
amortization of goodwill excluded from cost of revenues was $7.8 million
and $12.4 million, respectively.
During the three months and nine months ended September 30, 2000, the
amortization of the difference between the cost of our equity investments
and our share of the underlying net assets of ASI excluded from equity in
income of investees was $7.5 million and $16.1 million, respectively.
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AMKOR TECHNOLOGY, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
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<CAPTION>
SEPTEMBER 30, DECEMBER 31,
2000 1999
(UNAUDITED)
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Assets
Current assets:
Cash and cash equivalents $108,865 $98,045
Short-term investments 0 136,595
Accounts receivable --
Trade, net of allowance for doubtful accounts of $2,443 311,612 157,281
Due from affiliates 1,540 6,278
Other 8,208 6,469
Inventories 103,695 91,465
Other current assets 29,185 11,117
---------- ----------
Total current assets 563,105 507,250
---------- ----------
Property, plant and equipment, net 1,481,196 859,768
---------- ----------
Investments 452,022 63,672
---------- ----------
Other assets:
Due from affiliates 25,657 27,858
Goodwill and acquired intangibles 747,186 232,350
Other 165,169 64,191
---------- ----------
Total other assets 938,012 324,399
---------- ----------
Total assets $3,434,335 $1,755,089
========== ==========
Liabilities and Stockholders' Equity
Current liabilities:
Bank overdraft $25,049 $16,209
Short-term borrowings and current portion of long-term debt 73,669 6,465
Trade accounts payable 166,050 122,147
Due to affiliates 37,014 37,913
Accrued expenses 142,206 88,577
Accrued income taxes 44,267 41,587
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Total current liabilities 488,255 312,898
Long-term debt 1,623,933 687,456
Other noncurrent liabilities 52,350 16,994
---------- ----------
Total liabilities 2,164,538 1,017,348
---------- ----------
Commitments and contingencies
Stockholders' equity:
Common stock 152 131
Additional paid-in capital 970,880 551,964
Retained earnings 302,996 189,733
Receivable from stockholder (3,276) (3,276)
Accumulated other comprehensive income (955) (811)
---------- ----------
Total stockholders' equity 1,269,797 737,741
---------- ----------
Total liabilities and stockholders' equity $3,434,335 $1,755,089
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